Major Labels Win, and Lose, Infringement Case Against 'Russian Facebook'

A court in St. Petersburg has announced a verdict in the lawsuit filed by Warner and Universal against VKontakte, "the Russian Facebook," which does not see any damages going to plaintiffs, but obliges VKontakte to implement changes to its features that will prevent users from uploading music content.

In the lawsuit, originally filed by Sony Music Russia, Universal Music Russia & Warner Music UK, plaintiffs demanded compensation of just over 50 million rubles ($760,000) for the availability of unlicensed repertoire on the site, mostly sourced from VKontakte users uploading illegitimate music tracks.

The plaintiffs also demanded that a system to prevent users from uploading copyrighted tracks should be created, a claim that the court supported.

In late July, Sony pulled out of the lawsuit, signing a goodwill agreement with VKontakte, the details of which have not been revealed.

The International Federation of the Phonographic Industry (IFPI), which coordinated the lawsuit, welcomed the judgment as "significant," as, when implemented, it "should improve the environment for developing a thriving licensed music business in Russia."

"This is a very important and positive decision for the Russian music market and for music creators in Russia," IFPI Chief Executive Officer Frances Moore said in a press release. "VK’s infringing music service has been a huge obstacle to the development of a licensed business in Russia, making available hundreds of thousands of copyright infringing tracks to more than 70 million daily users."

"We now look to VK to implement the court’s decision and stop these ongoing infringements," she went on to say.

VKontakte was not, apparently, disappointed with the judgement.

"We are glad that the court supported our position and has declined to impose fines on VK," Georgy Lobushkin, a spokesman for VKontakte, tells Billboard. "The court has also ordered that we make our music copyright DMCA technology more effective, and we are constantly working on that."

He also criticized comments from the "opponents" -- apparently referring to the IFPI's statement --  saying they were to quick "to comment on the judgement in the most advantageous way for themselves" without even seeing the court's explanation of the verdict.

The lawsuit was filed in April 2014, following plaintiffs' attempts to reach a private agreement with VKontakte. Several similar lawsuits have been filed against VKontakte over the last few years by local rights holders. Up to now, Russian courts were satisfied with the social network's claim that it has no control over user generated content.

Another lawsuit filed against VKontakte by Nikitin Media Digital is currently in progress, in which the plaintiff claims 750 million rubles ($11.4 million) in damages over infringing repertoire.